Which of the Following Is a Correct Statement Regarding the Nature

question 42

Multiple Choice

Which of the following is a correct statement regarding the nature and timing of communications between an accounting firm performing an initial audit of an issuer and the issuer's audit committee?

• A)Prior to accepting the engagement, the firm must orally affirm its independence to the audit committee with all members present.
• B)The firm must address all independence impairment issues on the date of the audit opinion.
• C)Communications related to independence may occur in any form prior to issuance of the financial statements.
• D)Prior to accepting the engagement, the firm should describe in writing all relationships that, as of the date of the communication, may reasonably be thought to bear on independence.

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Definitions:

Chi-Squared Distribution

A distribution that represents the distribution of the sum of the squares of k independent standard normal random variables.

P-Value

The chance of encountering test outcomes as significant as or more than what is actually seen, assuming that the null hypothesis holds.

Population Locations

The geographically-based positions or areas where members of a specific population are found or located.

Ordinal

Pertaining to a scale or measurement where the order of values is significant, but the intervals between values are not necessarily consistent or known.